Monday, January 30, 2006
Dr. Schlesinger's remarks drew from his article in the Winter 2005/06 issue of The National Interest, again a warning about the forthcoming "liquids crisis" in energy as petroleum stocks run down, and that the longer we wait to do something about it, the harder the crunch will be.
I was intrigued by the Senator's remarks. Those who are familiar with his positions know he supports drilling in ANWR, developing natural gas sources in the Gulf of Mexico, and building more nuclear plants to generate electrical power. People disagree vehemently over these courses of action, but I thought that he made a critical point: our standard of living depends upon (and is linked inextricably to) access to energy. We cannot sustain our lifestyle in the absence of energy supplies.
This means thinking about tradeoffs. He noted that some are calling for boycotting Iran as a means of pressuring them on their nuclear program. Well and good. This deprives the market of 1 million barrels of oil per day. ANWR could supply that. Or we should be prepared to pay at least $20 per barrel more. Or we have to be prepared to make changes in our lifestyle (for example, shifting to more mass transit).
What I thought was useful is that he dispensed with the fantasy land so many of us cling to: that we can have cheap energy, no changes in lifestyle, no environmental impacts and wield pressure against oil producing nations with no ill effects. Energy policy is not independent of or somehow separate either from foreign poicy or domestic policy--and we need to have the same setting of priorities that enables us to make choices.
Iran currently has net exports around 2.6 million bbl/d, out of total production of around 4.2 million bbl/d. (But on a gross basis, it exports more crude than that, and imports a substantial amount of petroleum products.)
So anyway, the two aren't really comparable in terms of volume. But I definitely agree with the points James Schlesinger made in the TNI article about a coming paeriod of scarcity, and the idea that this will impose constraints on U.S. policy, and force us to make tradeoffs.
The figure I cited of five months was too low but if I understand it the estimate Holdren gives for ANWR is 0.6 to 2 years US consumption, or 1-4 years current imports, or ten percent of projected imports from 2010 to 2020.
That's a lot of oil but it would still seem to me more useful as a backup strategic petroleum reserve than as a source for current consumption. However, we do need to be thinking more seriously about how to reduce our dependence on imported oil.
But anyway, the broader point I would make is that, even if U.S. production were 1 million bbl/d higher, that still wouldn't fundamentally change the structure of the world oil market, or give the U.S. more influence over prices. A significant disruption of supplies from the Persian Gulf would still have major consequences for the U.S. economy.
Freedom on the march indeed.
moved to a more techie hosting company. This one is a bit too DIY for me — I’m a novice
server admin — and the support seems dodgy (although the user forums are nice an